Cost increases are coming — your rates need to reflect that sooner than later
From Overdrive magazine, a great article about the need to have your rates reflect the true cost of operations.
From Overdrive magazine, a great article about the need to have your rates reflect the true cost of operations.
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A short article from the Harvard Business Review.
Don’t reject an applicant based on their criminal record alone.
One way to make good on your company’s commitment to improve its diversity, equity, and inclusion efforts is to implement a “fair-chance hiring” initiative. These programs grant everyone, regardless of criminal background, an opportunity to be fairly assessed for a given role: You only examine the candidate’s criminal record after the person has been interviewed and is considered qualified. To start a fair-chance hiring program at your company, coordinate with your leadership team, human resources, and legal department to make sure everyone is on the same page about the mission, and how you’ll implement the initiative. Then connect with local partners to identify talent. Look for community-based organizations that focus on workforce development for reentry. Conduct skills-based interviews with candidates, and focus on their transferable skills, potential, and willingness to learn rather than their work experience (or lack of it). Finally, when the time comes, assess candidates’ records by considering what they were convicted for, how long it’s been since the offense, and the nature of the job that they’re applying for. Giving everyone a fair shake is an important step in building a more equitable workplace — and society.
This tip is adapted from “Give Job Applicants with Criminal Records a Fair Chance,” by Margie Lee-Johnson
As your business grows, more team members will be involved in the decision making process. From the Harvard Business Review, here is a short article on how to best use the different personalities and talents on your team to get the best results.
When you have a tough business problem to solve, you probably bring it to a group. But there are risks to asking a team to collectively make decisions — namely, groupthink. Fortunately, there are behavioral science-based tactics that can help overcome the downsides. First, keep the group as small as possible. Having more voices in the room increases the likelihood that you’ll default to decisions that enforce the status quo. Next, make sure your group is diverse — in every sense of the word — in order to reduce bias. Try appointing a “devil’s advocate,” a person whose job is to test consensus. Watch out for blind trust in experts: While they can help you become more informed, making them part of your decision-making can sway your team’s judgments. So you might invite them to provide their opinion on a clearly defined topic, but position them as informed outsiders. And finally, make sure that the group shares collective responsibility. Everyone should feel accountable for the decision and its outcomes.
This tip is adapted from “7 Strategies for Better Group Decision-Making,” by Torben Emmerling and Duncan Rooders
https://www.wastetodaymagazine.com/article/waste-management-merger-acquisition-strategy/
Coming up with a proper, and thoroughly vetted, valuation is essential for waste companies interested in acquiring another business. Waste Management, Houston, has been no stranger to the acquisition process in route to becoming the industry’s largest player.
Joe Cassin, western VP of business development for Waste Management, helps spearhead the company’s valuation and due diligence process when assessing potential acquisition targets. Cassin says that the groundwork for an acquisition is often laid well in advance of any agreement thanks to the company’s evaluation processes.
“As a company, we have 17 market areas managed by 17 area vice presidents who are responsible for the P&L of each of those markets, which can be as large as $1 billion in revenue,” Cassin says. “We are constantly analyzing those markets, and we then strategize on the right growth opportunities from an acquisition standpoint. This is an annual process that identifies the strategic growth opportunities as well as the potential acquisition candidates. Once we understand the benefit of a specific company, it’s the business development team’s responsibility to develop a relationship with those owners and, hopefully, when they’re ready to sell or curious to know their company’s value, we’ll be the first one they call. The valuation process is very straightforward and kept very confidential during the entire process.”
Cassin says there is a number of criteria Waste Management looks at during the valuation process. Among the most important considerations are the reliability of the target company’s long-term cashflow; diverse customer mix; favorable contract terms; age and compatibility of the equipment with Waste Management’s existing fleet; service area footprint; potential future growth opportunities; and Waste Management’s ability to recognize synergies of the business to be acquired. The company will also work to ascertain the percentage of temporary roll-off, broker and event work a company manages.
Once the two parties express mutual interest in exploring a possible acquisition and a confidentiality agreement is signed, Waste Management will request a half-dozen pieces of information to better understand the company and its operations. This includes an income statement, balance sheet, list of assets, head count by position and a list of any permits or real estate that’s going to be included as part of the transaction.
Cassin says that most of the company’s due diligence will be done remotely, with any on-site equipment inspections scheduled after hours or on weekends for confidentiality purposes. In addition to the financial due diligence, Waste Management will also want to understand a company’s safety culture, environmental compliance practices, any underlying HR issues, condition of equipment, day-to-day operational standards and billing cycles. While much of the financial information is formulaic, Cassin says that sometimes measuring a company’s culture can be more instinctual.
“Often you rely on your gut instinct,” Cassin says. “I can tell what kind of company it is and how it’s run often by looking at the trucks on the road. A clean and tidy truck shows pride of ownership verses one with a dashboard full of Post-It notes and food wrappers. When you see companies where the owners take pride in their equipment, you generally find that they’re taking care of their employees, customers and have a strong safety culture. A well-run company starts at the top and eventually trickles down through the entire staff. You really get a good sense of what a company is all about when you kick the tires and talk to the owner and see it with your own eyes. We’ll ask them about their safety policy, preventative maintenance practices, customer retention, and more, but again, you get a good sense of the business from walking their facility and seeing their fleet, which we do in every case.”
“When you see companies where the owners take pride in their equipment, you generally find that they’re taking care of their employees, customers and have a strong safety culture. A well-run company starts at the top and eventually trickles down.” –Joe Cassin, western VP of business development for Waste Management
Once the seller provides the requested information, Waste Management will model and review the pro forma typically over three or four weeks before the company presents a valuation, Cassin says; however, larger transactions may take longer to value based on the level of detail.
“While EBITDA multiples are widely talked about, we value companies based on several different metrics that analyze the long-term benefit to Waste Management,” Cassin says. “Once we have what we believe to be an accurate model that reflects what the target company can deliver (it generally won’t look anything like the seller’s financials because we’re going to look at the business synergies, etc.), we’ll then feel comfortable talking with the seller about our assumptions and valuation. The modeling takes into consideration everything from growth assumptions to capital requirements. At this point, we’ll meet with the seller face to face and walk them through our assumptions, valuations, due diligence process and what to expect next.”
Cassin says that it’s important for companies thinking of selling to focus on some key areas of their business. Specifically, Cassin says that these companies should prioritize cashflow, customer loyalty, contract terms and the quality of the assets that will be delivered to the buyer. Having the right people in place also makes a company more attractive, Cassin says.
For other companies considering acquiring a business, Cassin says that focusing on a few key metrics can go a long way in ensuring a favorable transaction.
“Companies should consider the delivered cashflow and future capital expenditure requirements needed to keep the business going. They should consider what the payback period is in years and determine whether the contract term(s) support the multiple being paid. It’s also important to think about what their post-closing growth strategy is, whether customer retention will be a challenge, and if they have the right management team in place to integrate the business,” he says.
Regardless if a business is looking to acquire another company or be acquired, Cassin says that the number of opportunities in the waste space makes it an attractive sector for interested parties.
“What’s unique about the waste industry is that there are many qualified buyers where funding is not an issue. If you owned a chain of dry cleaning businesses, for example, you might be challenged on finding a qualified buyer,” he says. “Conversely, if you own a well-run garbage company with a solid customer base, you’re going to be able to pick up the phone and be ‘retired’ within 120 days, if that’s what you’re looking for.”
Even with COVID-19 forcing Waste Management to transition some of its acquisition-related diligence to virtual meetings, Cassin says that the acquisition team hasn’t been noticeably slowed by the pandemic. Despite fears of how COVID might ultimately affect the M&A market, Cassin says that he’s confident that waste operators will be able to thoroughly vet companies and look past any short-term economic disruptions that would-be sellers are presently experiencing.
“When states opened up temporarily [in late spring], it looked as if there was going to be a quick recovery,” he says. “All waste companies have experienced challenges with hospitality, schools, special events, etc., after many of these entities were shut down for several months. That said, if somebody is thinking about selling now, even though their revenues have been temporally impacted, we still have a good sense of what their business will look like during the recovery. What we’re experiencing presently shouldn’t persuade companies to change their plans.”
This article originally appeared in the July/August issue of Waste Today. The author is the editor of Waste Today and can be contacted at aredling@gie.net.
I’ve talked to a lot of business owners carrying the burden of guiding their business through these difficult times. The idea of self care, of putting our needs first, to better serve the members of our team, is an idea that may not come naturally to all entrepreneurs. Remember, you team may be in a sprint, but you as the leader need to focus on the marathon, never losing your long-term perspective!
Read this short article from the Harvard Business Review, and think about your day to day priorities.
You probably already know that sufficient sleep, proper nutrition, physical exercise, human connection, and time to relax are important — but do you actually carve out time for them? When you consider caring for yourself as unrelated to work, you’re likely to let your business priorities come first. But your resilience is a high-priority business issue, especially when you’re leading a team through the stress of our fast-paced world. Research shows that our decision-making dramatically suffers when we neglect to properly rest and refuel, so make self-care a daily priority. You don’t need to dedicate hours a day though. You can boost your short-term resiliency by taking a short walk or reaching out to a friend you haven’t talked to in a while just to check in. Investing in yourself isn’t indulgent — it’s mission critical. It’s time to tell yourself, “It’s so busy at work right now, I can’t afford NOT to take care of myself!”
This tip is adapted from “Reframe How You Think About Self-Care,” by Liane Davey
Last week, I had a chance to enjoy some extended rest and relaxation in the state of Maine which is known for its lakes, beaches and seafood—especially lobster. In the summer, a top destination is Maine’s array of family-owned seafood shacks where diners order at a counter, pick up food and eat at picnic tables outdoors. They’re fast, fresh and perfect for a pandemic.
Our family made a list of the restaurants we wanted to try and ordered takeout on our second night in Maine from a place called Beal’s Lobster, located 15 minutes away from where we were staying. When we picked up our food and brought it back to the house, we discovered our entire order was incorrect. The items that were supposed to be grilled were fried, and vice versa. We also received things we did not order, and were missing things we did.
When we called Beal’s to let them know, the woman who answered was extremely apologetic and offered to remake everything for us. Not wanting to make the 30-minute round-trip again, we said we would make do with what we had, and she offered to credit the entire order proactively.
An hour later, the owner of the restaurant called to offer his own apology. He did not make any excuses, he just wanted to also apologize personally and offered for us to come back again that week on the house. We took him up on the offer and the food was excellent, the best we had that trip. I have recommended it to many friends.
Two nights later, we went to a different family-owned seafood shack that seated about 15 people. When we placed our orders, we were warned the wait was about 20-25 minutes as the food is typically pretty fast. After about 45 minutes, I asked about our order as our friends had already been served. One of the owners responded they had just received 30 online orders and were running behind. She promised the food would be right out and worth the wait and that she would bring it to our table. I thanked her.
After 30 more minutes, I followed up again as the kids were getting restless. The owner went right back into the same story about the surge of online orders. I said understood, but we had now been waiting for over an hour were told it would be “right out” 30 minutes ago. Her response was “well, clearly, I am not going to charge you for dinner,” in a tone I would best describe as doing the right thing for the wrong reason; it felt insincere and devoid of accountability or understanding. It also wasn’t what I cared about. One and a half hours after we ordered, our name was finally called and I found the order bagged up for takeout.
Comparing these two restaurant experiences, the different approaches of their cultures was evident. Beal’s did not try to make excuses or tell us why they screwed up our order, they simply owned it and tried to fix it. Generally, I am a big fan of asking why to get to the root of issues. But customers often don’t want or need to know why; they are interested in the solution, not the root of the problem or the intricacies of your business.
When businesses attempt to explain to a customer why they make a mistake, instead of focusing on the impact of that mistake, they open up a pandora’s box of further scrutiny. For example, when I was told about the online orders, I wondered why they don’t flag the orders for people who are waiting in-person or why these large online orders got priority. It didn’t help. If I told a customer of ours I had overlooked their marketing project because I was too busy with a bigger project that came in after theirs, I would almost certainly lose that customer and especially in this challenging market.
In some cases, it might be helpful to let a customer know about an extreme, unexpected event, such as a natural disaster, or a warehouse fire, as the root of a problem versus a routine mistake or mismanagement. As a general rule, however, it’s better for organizations not to share these details with customers and focus instead on what’s important and relevant for them—the solution.
Organizations become great by doing the little things in a world-class fashion. Service is one of them.
Quote of The Week: “The key is when a customer walks away, thinking ‘Wow, I love doing business with them, and I want to tell others about the experience.’ ” – Shep Hyken
The above post is a Friday Forward, my weekly leadership note read by 260,000+ leaders in over sixty countries. Join Today.
Robert Glazer is the founder and CEO of Acceleration Partners, an award-winning partner marketing agency ranked #4 on Glassdoor’s best places to work. Robert was also named twice to Glassdoor’s list of Top CEO of Small and Medium Companies in the US, ranking #2 and was recently named one of Conscious Company’s top 22 conscious business leaders. He is a member of Marshall Goldsmith’s 100 Coaches initiative. His latest book, Friday Forward, comes out September 1.
Here is a short read about motivating your team from my good friend, Rhoda Kreuzer. If you manage people, you need to read this.
“Impacting the World, One Person at a Time”
You never know how or when you’ll have an impact, or how important your example can be to someone else.
– Denzel Washington
Many people have been planting flowers, fertilizing their lawns, and trimming bushes all in hopes of having a beautiful landscape to enjoy. That same lawn that you have tended would probably be brown and full of weeds if you had not taken steps to ensure it would be healthy. Likewise, your flowers would be wilted and crumpled if you did not water them and give them plenty of sunlight.
The people on your team are just like the grass or flowers in your landscape.They need certain care in order to flourish. If neglected, they may still do their job but most likely not to their full potential. In a Gallup Organization study, they found that most employees need to receive feedback and recognition once every seven days. That may sound like a lot, but consider how much stress they experience, how many complaints they may field from customers, or the challenges they face from week to week.
Your one single comment may not seem like a lot, but it is huge in warding off burn out and fatigue. Your positive messages and example may be just what they need to keep a smile on their face and create raving fans from your customers. Make a difference by displaying gratitude to your team, listening to their needs, and treasuring their input. Water them through training and mentoring opportunities. You can have a positive influence on those you lead and reap the enjoyment of having an awesome team!